Retrospective classification of tarpaulins as cotton fabrics excluded them from the residuary tax entry and rejected alternate treatment.

Retrospective enlargement of the statutory definition of cotton fabrics was read into the referential tax entry, so tarpaulins made from processed canvas cloth with waterproofing treatment fell within the expanded meaning of cotton fabrics under entry 37. The court rejected a use-based or commercial parlance approach because the specific defined entry controlled classification, and the legislative amendment operated as if the enlarged meaning had applied from the relevant date. Tarpaulins were therefore excluded from the residuary entry in Schedule III, and the alternative classification as articles prepared from textile fabrics under entry 18(a) was not sustained.

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Issues: Whether tarpaulins, in view of the retrospective enlargement of the definition of cotton fabrics and the nature of entry 37, were liable to be treated as cotton fabrics and outside the residuary entry in Schedule III, and whether they could alternatively be treated as articles prepared from textile fabrics under entry 18(a) of Schedule II, Part A.

Analysis: The reference court treated the amended definition of cotton fabrics in the Central excise law as applicable to the Gujarat Sales Tax Act because entry 37 incorporated that definition by reference. The retrospective amendment was held to operate on the legal fiction that the enlarged meaning of cotton fabrics had been in force from the relevant date, and the referential entry was construed as supplemental to the central excise and additional excise scheme. On that basis, the court held that the legislative amendment had to be read into entry 37, and that tarpaulins made from processed canvas cloth with waterproofing treatment fell within the expanded meaning of cotton fabrics. The court further held that the use-based or commercial parlance approach could not override the defined entry, and that the alternative classification as articles prepared from textile fabrics also could not be sustained.

Conclusion: Tarpaulins were held to be cotton fabrics under entry 37 of Schedule I and were not taxable under the residuary entry in Schedule III. The alternative contention under entry 18(a) also failed.

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